Kenya Shilling Rises to Five-Week High as Businesses Pay Taxes

Kenya’s shilling rose for a sixth
day, reaching the highest in more than five weeks, as businesses
sought the currency to settle tax bills.

The currency of East Africa’s largest economy appreciated
as 0.6 percent to 83.60 per dollar by 5:02 p.m. in the capital
Nairobi, its strongest since May 15.

“The shilling has gained as businesses make payment of their
taxes and a tight liquidity situation in the market following
the recent drive to curb money supply by the central bank,”
Duncan Kinuthia, a dealer at Nairobi-based Commercial Bank of
Africa Ltd., said in a phone interview today.

The central bank did not offer repurchase agreements and
term-auction deposits today, a central bank official who asked
not to be named in line with policy said. The bank re-introduced
term-auction deposits as a “liquidity management” measure on
June 5, according to a statement on its website.

Uganda’s shilling weakened 0.1 percent to 2,487.50 per
dollar, while Tanzania’s currency appreciated less than 0.1
percent to close at 1,582 per dollar.